BP wins ruling to cut potential Gulf of Mexico fine by $3.4bn

BP has won a ruling that 810,000 barrels of oil captured before they entered
the Gulf of Mexico in 2010 will not be counted in the upcoming civil court
case.

BP's overall provision for the spill includes $3.5bn for fines under the Clean Water Act, although this could be dwarfed by the total possible fine of $20bn. BP disputes the US authorities' view of both how much oil was spilled and the level of negligence involvedPhoto: REUTERS

The move reduces the potential fine under the Clean Water Act by $3.4bn.

BP is prepared for a court fight with US authorities over civil penalties for its role in the Gulf of Mexico oil spill, arguing that the fine it should face should be less than a quarter of the $20bn (£12.9bn) estimated by some analysts.

Following lengthy talks, the oil giant has indicated it does not expect to reach a settlement with the US Department of Justice ahead of its trial in America, which is due to start on February 25.

BP’s overall provision for the spill had included $3.5bn for fines under the Clean Water Act, although this could be dwarfed by the total possible fine of $20bn. BP has disputed the US authorities’ view of both how much oil was spilled and the level of negligence involved.

It strenuously denies a charge of gross negligence, which carries a maximum penalty of $4,300 per barrel spilt. Ordinary negligence carries a penalty of up to $1,100 per barrel.

“What is clear is that [gross negligence] is a very high bar, and we firmly believe the bar is not met in this case," said Mr Bondy. He said that the actual range of penalties BP could face started “far far below” the $5bn often cited as the minimum possible.